Jurisdictional Discovery Needed in 9/11 Civil Case

MANHATTAN (CN) – The 2nd Circuit upheld the dismissal of all but a dozen defendants in an appeal involving a subset of charities, banks and people sued by the families of victims of the September 11, 2001, terrorist attacks.

The federal appeals court in New York vacated a decision to dismiss the 12 from a sweeping multidistrict lawsuit against hundreds of defendants accused of knowingly funding al-Qaida and its attacks on U.S. soil.

Victims’ families and estates claimed the attacks “could not have been possible had it not been for the knowing material support provided to al Qaeda by [the] charities, banks, [and] foreign officials” named in their complaints. (Brackets in original.)

The cases were consolidated and the defendant lists whittled on appeal, with a federal judge dismissing 76 defendants, including 37 for lack of personal jurisdiction.

In a ruling addressing only the jurisdiction-based dismissals, the 2nd Circuit agreed that it lacked jurisdiction over 25 of the 37 defendants, including foreign financial institutions and relatives of Osama bin Laden.

The three-judge panel said the victims’ families failed to show that those defendants “expressly aimed their allegedly tortious conduct at the United States.”

The remaining dozen, however, “warrant jurisdictional discovery” to determine if they “provided financial and other resources to al Qaeda knowing that al Qaeda was engaged in a global campaign of terror against the U.S.,” Judge Jose Cabranes wrote for the panel.

Those 12 include nine officials of purported charities, an aviation services company called Dallah Avco and two individuals, Yassin Abdullah Al Kadi and Saleh Al-Hussayen.

Al Kadi allegedly co-founded the Muwafaq Foundation, ran it for five years with $15 million to $20 million of his own money and was “one of al Qaida’s chief global financiers,” according to the victims’ families and estates.

They claimed Al-Hussayen traveled to the United States shortly before the 9/11 attacks and stayed in the same hotel as at least three of the hijackers. He then faked a seizure when the FBI questioned him about the attacks, the plaintiffs said.

Dallah Avco is an aviation services company that allegedly “provided a ‘ghost’ job” to a Saudi citizen in San Diego who directly funded two of the 9/11 hijackers.

The allegations against the charity officials and Al Kadi “suggest that [they] directly provided financial and other resources to al Qaeda knowing that al Qaeda was engaged in a global campaign of terror directed at the United States,” Cabranes wrote.

But the court said questions remain about what support was given and when, and whether “the support was ‘earmarked’ for use in specific schemes or attacks not directed at the United States.” Compared to the claims against the other defendants, the allegations against al-Hussayen and Dallah Avco “suggest a closer nexus between their alleged support of al Qaeda and the September 11, 2001 attacks,” the court noted, but said more information is needed.

The panel vacated the dismissal of those 12 defendants and remanded for further jurisdictional discovery.